As Nikkei Surges, Some Investors Sit Out

By

Kana Inagaki

Feb. 13, 2013 3:01 p.m. ET

TOKYO—A rush of investment from speculators and hedge funds has made Japan's stock market one of the best performers in the world in recent months. But the sustainability of the rally will depend on whether mainstream investors—from big global funds to Japanese mom-and-pop buyers—see enough signs of economic improvement to jump in, market participants say.

"The idea that things may be changing in Japan has prompted a lot of interest in what happens next,'' says Campbell Gunn, Japan head for asset manager T. Rowe...